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Letter of Correspondence

 MTR Corporation Limited

 MTR Tower, Telford Plaza

 33 Wai Yip Street

 Kowloon Bay Hong Kong

 September 22, 2005

 Via Facsimile and
EDGAR

 Ms. Linda Cvrkel

 Branch Chief

 Mail Stop 0305

 Division of Corporation Finance

 Securities and Exchange Commission

 100 F Street, N.E.

 Washington, DC 20549

 United States of America

RE:
MTR Corporation Limited

Annual Report on Form 20-F for the fiscal year ended December 31, 2004

Filed June 17, 2005, File No.
333-13904

 Dear Ms. Cvrkel:

 We are writing in response to the Staff’s comment letter dated August 29, 2005, relating to the Annual Report on Form 20-F of MTR Corporation Limited
(the “Company”) for the fiscal year ended December 31, 2004 (the “2004 Form 20-F”).

 We will submit a copy of this letter as “correspondence” via EDGAR. In addition, we are submitting on paper as Appendix A to this letter a copy
of the relevant pages of the 2004 Form 20-F, marked to show revised disclosure that we have prepared in response to the comments indicated below. We propose to include this revised disclosure in our Annual Report on Form 20-F for the fiscal year
ending December 31, 2005 (the “2005 Form 20-F”) in response to the Staff’s comments. The revised disclosure has been prepared to reflect facts, data and conditions in our business and operations as of the date of this letter or as of
particular past dates as indicated, and will be updated in the 2005 Form 20-F to reflect facts, data and conditions as of the respective dates as will be required or otherwise described in the 2005 Form 20-F. We do not propose to amend the 2004 Form
20-F.

 For your convenience, we have included your comments in
this response letter in italicized form and keyed our response accordingly. Our responses to the comments are as follows.

 Ms. Linda Cvrkel

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 Critical Accounting
Policies

 Project Provisions, page 59

1.
We note that under HK GAAP, your company establishes project provisions for the settlement of estimated claims that may arise under various contracts due to time delays,
additional costs, or other unforeseen contingencies common to major construction projects. Upon the completion of a project, such provisions are capitalized as a part of the project’s assets. Please tell us how you account for these provisions
for U.S. GAAP purposes and explain why you believe the treatment used is appropriate. Also, tell us the amount of provision that was recorded during each year presented in your financial statements.

 We respectfully inform the staff that the provisions referred to under this
heading relate to contract claims on works completed but final accounts not yet agreed between contractors and the Company due to difference in measurement in respect of time delays in site handover, including incremental labor costs and premium on
construction materials, additional costs or other unforeseen costs not covered under original contracts, which are common to major construction contracts. The provisions represented the Company’s estimated final costs on completed works and
were therefore capitalized as project expenditures with corresponding entry in creditors, accrued charges and provisions. The capitalised amount represents contract costs incurred in the construction of the assets for its intended use. Pursuant to
the definition of assets stipulated in SFAS No. 6, the provisions are capitalized under U.S. GAAP in the same manner as under HK GAAP.

 The amount of such costs provided for 2002, 2003 and 2004 were HK$1,130 million, HK$746 million and HK$301 million respectively.

 Liquidity and Capital Resources

 Liquidity, page 70

2.
We note that your table of contractual obligations appears to exclude certain payment obligations related to leases. For example, your table does not appear to include your
company’s payment obligations related to the land which is leased from the government until June 29, 2050, upon which your railway stations, depots, other civil works, plant and other equipment are situated. Please revise your table of
contractual obligations to include all material lease obligations of your company or explain why you do not believe this is required.

 Ms. Linda Cvrkel

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 We
respectfully inform the staff that, unlike many other countries, all lands in Hong Kong granted by the Government are on leasehold terms with a land premium (cost of the right to use the land during the entire tenure of the lease) being prepaid upon
award of the land grants. Prepaid land premiums are then amortized over their unexpired term on a straight line basis. Because the land lease expenses have been prepaid, they are not ongoing contractual obligations.

 Item 8. Financial Information

 Legal Proceedings, page 90

3.
We note per your critical accounting policy regarding project provisions on page 59 of your document that your company establishes project provisions for the settlement of
estimated claims that may arise under various contracts due to time delays, additional costs, or other unforeseen contingencies common to major construction projects. Your company then capitalizes the project provisions as part of the constructed
assets upon completion of the project. If you have accrued provisions as a result of the disputes arising from essential infrastructure works carried out on behalf of your company by the Highways Department and Territories Development Department of
the Government for the construction of the Tung Chung Line and Airport Express Line, please tell us, for U.S. GAAP purposes, whether such provisions have been recognized as a part of the asset costs of such projects, or expensed as a charge to
income, and explain why you believe the treatment used was appropriate. We may have further comment upon receipt of your response.

 We respectfully inform the staff that the disputes between the Company and Highways Department and Territories Development Department of the Government in
relation to works entrusted by/to the Government under the Tung Chung and Airport Express Line (“Airport Railway”) relate to differences in work measurement for reasons similar to those explained in question 1 above. As these costs
represent estimated additional costs incurred in the construction of assets for its intended use, such provisions, representing the Company’s best estimate of its outstanding obligations in respect of those entrustment works already completed,
have been capitalized as part of the Airport Railway’s asset costs for both HK GAAP and U.S. GAAP purposes.

 Ms. Linda Cvrkel

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 (G) Depreciation, page
F-10

 (D) Depreciation of Certain Fixed Assets, page F-72

4.
We note per your discussion of the company’s depreciable lives that your company depreciates certain fixed asset classifications over a period of 80 to 100 years (e.g.
tunnel linings, underground civil structures, depot structures, station building structures, etc.) under Hong Kong GAAP. We note, however, that similar fixed assets held by other companies in your industry generally are not depreciated over a period
that is greater than 40-50 years for U.S. GAAP purposes. As this appears to be a difference in accounting between Hong Kong GAAP and U.S. GAAP, please expand your discussion in the “Depreciation of Certain Fixed Assets” section of Footnote
47 to your financial statements to discuss this difference and disclose the impact of this difference in accounting in your reconciliations of net income and stockholders’ equity under Hong Kong GAAP to U.S. GAAP. Alternatively, please explain
why you believe your depreciation policies are appropriate under U.S. GAAP.

 We wish to advise the staff that the Company has considered the design lives of these assets, our on-going asset repair and maintenance program as well as benchmark treatments from similar enterprises elsewhere.

 The Company supplementally advises the staff that the
estimated useful lives of 80 to 100 years for these assets is supported by technical views from engineering experts based on the original asset design lives and the Company’s rigorous repair and maintenance program for such assets. Comparison
of treatment from similar systems elsewhere, such as the London Underground, Tranz Rail (New Zealand) and the Metropolitan Transportation Authority (New York) have also been made. The Company has concluded that it is appropriate to use the same
estimated useful lives for these assets for calculation of depreciation under both HK GAAP and U.S. GAAP. Consequently, there is no difference to be described in our reconciliation of net income and stockholders’ equity under HK GAAP and U.S.
GAAP.

5.
We note per your disclosures in Note 16 that the initial cost of rails is not depreciated under Hong Kong GAAP. As it is industry practice under U.S. GAAP to depreciate the
capitalized costs for rails, please discuss in your reconciliation footnote this difference in accounting between U.S. GAAP and Hong Kong GAAP and disclose the impact of this difference on net income and stockholders’ equity in your
reconciliations. If you believe that the reconciliation of this difference is not necessary, please tell us why.

 Ms. Linda Cvrkel

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 We
respectfully inform the staff that, under HK GAAP, the Company is not required to depreciate certain rails assets which are kept under constant repairs so that they are maintained at their best working condition. Because the annual replacement costs
relating thereto in past years (HK$76 million, HK$74 million and HK$83 million for fiscal years 2002, 2003 and 2004 respectively) charged as operating expenses approximately equals the annual depreciation charge (HK$72 million, HK$77 million and
HK$79 million for fiscal years 2002, 2003 and 2004 respectively) of the assets had they been depreciated, this has not had a material impact under HK GAAP. Because an adjustment to U.S. GAAP would not have a material impact to net income and
stockholders’ equity under U.S. GAAP, the Company did not consider it necessary to recognize this difference.

 In addition, we wish to inform the staff that, effective January 1, 2005, the Company has adopted a new accounting policy to depreciate these rails assets
pursuant to a change in the applicable Hong Kong Accounting Standard. Accordingly, there will be no difference between HK GAAP and U.S. GAAP for this matter going forward.

 4 Operating Expenses before Depreciation, page F-21

6.
We note that in 2003, your company’s general and administrative expenses and other expenses included a write-off of HK$69 million of the deficit on revaluation of
self-occupied office, land and buildings. We also note that in 2004 your company’s general and administrative expenses and other expenses included a HK$69 million write-back of the charge taken in 2003, based upon the asset revaluation
performed in 2004. U.S. GAAP does not permit the annual revaluation of self-occupied office, land and buildings based upon their open market value. However, it is unclear whether your reconciliations of net income and stockholders’ equity based
upon Hong Kong GAAP to net income under U.S. GAAP includes the reversal of the income statement impact of adjusting your self-occupied land and buildings based upon the revaluations conducted under Hong Kong GAAP. Please tell us if the appropriate
reconciling items have been recorded, the line item in your reconciliation where the adjustments have been recorded, and the amount for which each reconciling item was recorded.

 We confirm that the reconciling items have been recorded in the depreciation
and accumulated depreciation adjustments on revalued properties and redevelopment in our U.S. GAAP reconciliation of net income and stockholders’ equity. The amounts of these were HK$69 million.

 Ms. Linda Cvrkel

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 14 Fixed Assets, page
F-31

7.
We note per review of your fixed asset footnote and your depreciation policy that you have capitalized leasehold land in your financial statements prepared in accordance with
Hong Kong GAAP. Please tell us whether these amounts are also capitalized for U.S. GAAP purposes. If so, tell us the relevant U.S. GAAP accounting literature that supports your capitalization of these costs.

 We confirm that the capitalized leasehold land represents amounts prepaid
related to operating leases for land from the Hong Kong Government. As all the land premium costs are paid in advance, the leasehold land payments referred to in the note are capitalized as prepaid lease costs and amortized over the lease terms for
U.S. GAAP purposes pursuant to paragraph 15 of SFAS No. 13.

8.
Also, we note that the reconciliation of your financial statements from Hong Kong GAAP to U.S. GAAP includes a reduction to fixed assets for costs that are permitted to be
capitalized under Hong Kong GAAP, but are not allowed to be capitalized for U.S. GAAP purposes. However, the nature of the capitalized costs that have been excluded from the balance sheet for U.S. GAAP purposes is unclear. Please tell us in further
detail the nature of the costs that are not being capitalized for U.S. GAAP purposes.

 We supplementally advise the staff that the costs disallowed for capitalization under U.S. GAAP relate to advertising, recruitment, allocated staff and
overhead costs and other costs of a non-incremental nature. We will expand Note 47G, “Capitalization of Certain Costs”, as illustrated on page F-73 of Appendix A, to provide more detail of the nature of such costs in our future filings.

9.
In addition, we note per your disclosures in Footnote 1G that you depreciate leasehold land under Hong Kong GAAP. Please tell us whether these assets are also depreciated for
U.S. GAAP purposes. If so, explain why you believe this treatment is appropriate.

 We respectfully inform the staff that, as described in response to comment 7 above, all the Company’s land leases relate solely to land leases from
the Hong Kong Government, and all payments have been made to the Hong Kong Government at the inception of the lease. As the Company has no bargain purchase option and there is no transfer of ownership upon the expiration of the lease, the lease is
recorded as an operating lease with reference to paragraph 25 of SFAS No. 13. As such, lease payments are amortized over their respective lease terms, which is the same as under HK GAAP.

 Ms. Linda Cvrkel

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10.
We note per your fixed asset policy on page F-7 of your document that investment properties with an unexpired lease term of more than 20 years are stated in the balance sheet at
open market value, as determined annually by independent, professionally qualified appraisers. Based upon Footnote 14 to your financial statements, these investment properties appear to consist of properties that are under both long-term leases and
medium-term leases.

 Note that under U.S.
GAAP, properties with an unexpired lease term of more than 20 years do not automatically qualify for capitalization in the balance sheet. Please tell us whether your company has evaluated the leases underlying your investment properties to determine
whether such properties should be capitalized for U.S. GAAP purposes, or more specifically in accordance with SFAS No. 13. As your investment properties consist of leased properties, please also tell us your basis for determining the historical cost
at which you record the properties in your balance sheet. We may have further comment pending your response.

 We respectfully inform the staff that, the investment properties as described in Footnote 14 are properties situated on leasehold land under both
long-term leases and medium-term leases. As the lease term is more than 75% of the estimated economic life of the leased property, all underlying leases of the Company’s investment properties fulfill the criteria stipulated under paragraph 7c
of SFAS No. 13 for qualification as capital leases under U.S. GAAP. For U.S. GAAP purpos